Strategic and General Services Committee SGS... · A Strategic and General Services Committee...

AGENDA

Strategic and General Services Committee

Wednesday, 21 January 2015, 6.00pm

CITY OF FREMANTLE

NOTICE OF A STRATEGIC AND GENERAL SERVICESCOMMITTEE MEETING

Elected Members

A Strategic and General Services Committee meeting of the City of Fremantle will be

held on Wednesday, 21 January 2015 in the Council Chamber, Town Hall Centre, 8

William Street, Fremantle (access via stairs, next to the playground in Kings Square)

commencing at 6.00 pm.

Matthew PiggottACTING DIRECTOR CITY BUSINESS

16 January 2015

STRATEGIC AND GENERAL SERVICES COMMITTEE

AGENDA DECLARATION OF OPENING / ANNOUNCEMENT OF VISITORS NYOONGAR ACKNOWLEDGEMENT STATEMENT "We acknowledge this land that we meet on today is part of the traditional lands of the Nyoongar people and that we respect their spiritual relationship with their country. We also acknowledge the Nyoongar people as the custodians of the greater Fremantle/Walyalup area and that their cultural and heritage beliefs are still important to the living Nyoongar people today." ATTENDANCE / APOLOGIES / LEAVE OF ABSENCE RESPONSE TO PREVIOUS PUBLIC QUESTIONS TAKEN ON NOTICE PUBLIC QUESTION TIME DEPUTATIONS / PRESENTATIONS DISCLOSURES OF INTEREST BY MEMBERS LATE ITEMS NOTED CONFIRMATION OF MINUTES That the minutes of the Strategic and General Services Committee dated 10 December 2014 be confirmed as a true and accurate record. TABLED DOCUMENTS

TABLE OF CONTENTS

ITEM NO SUBJECT PAGE

REPORTS BY OFFICERS (COMMITTEE DELEGATION) 1

REPORTS BY OFFICERS (COUNCIL DECISION) 1

SGS1501-1 INFORMATION REPORT - STRATEGIC AND GENERAL SERVICES COMMITTEE - JANUARY 2015 1

SGS1501-2 HIGH STREET MALL REVITALISATION STRATEGY 2

SGS1501-3 APPLICATION FOR NEW LEASE - LOT 39 DALY STREET, SOUTH FREMANTLE 15

SGS1501-4 PROPOSED UPGRADE AND DEDICATION OF PRIVATE RIGHT OF WAY NO. 62 (TRUSTING LANE) - SURVEY RESULTS 22

SGS1501-5 AWARD OF TENDERS FCC 426/14 AND FCC 432/14 - LEIGHTON BEACH CHANGE ROOMS AND KIOSK 25

SGS1501-6 PERTH WATER TRANSPORT PTY LTD - APPLICATION FOR NEW LEASE 30

SGS1501-7 2 PHILLIMORE STREET, FREMANTLE - NEW LEASE 37

SGS1501-8 MONTHLY FINANCIAL REPORT - DECEMBER 2014 46

CONFIDENTIAL MATTERS 53

SGS1501-9 APPLICATION FOR LEASE - FLOWHOUSE - PORTION OF PORT BEACH RESERVE 53

Summary Guide to Citizen Participation and Consultation 54

AGENDA ATTACHMENTS 1

SGS1501-2 HIGH STREET MALL REVITALISATION STRATEGY 2

SGS1501-3 APPLICATION FOR NEW LEASE - LOT 39 DALY STREET, SOUTH FREMANTLE 53

SGS1501-6 PERTH WATER TRANSPORT PTY LTD - APPLICATION FOR NEW LEASE 57

SGS1501-7 2 PHILLIMORE STREET, FREMANTLE - NEW LEASE 150

SGS1501-8 MONTHLY FINANCIAL REPORT - DECEMBER 2014 189

Agenda - Strategic and General Services Committee 21 January 2015

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REPORTS BY OFFICERS (COMMITTEE DELEGATION)

The following items are subject to clause 1.1 and 2.1 of the City of Fremantle Delegated Authority Register Nil

REPORTS BY OFFICERS (COUNCIL DECISION)

SGS1501-1 INFORMATION REPORT - STRATEGIC AND GENERAL SERVICES COMMITTEE - JANUARY 2015

ESPLANADE RESERVE DOG OFF LEASH EXERCISE AREA FROM 5.00 AM TO 8.00 AM

ECM Reference: 035/001 Author: Cameron Bartkowski, Manager Community Safety and

Parking Agenda Attachments: Nil On 27 November 2013 Council approved the Esplanade Reserve to become a dog off leash exercise area from 5.00 am to 8.00 am. The Council requested a report be bought back to Council after twelve months advising of any impact of the trial. During the twelve months from 17 January 2014, which was the date the amendment to the local law was gazetted, no incidents were reported. Other departments of the City have performed works as usual during the exercise time frame. As no adverse impact has been identified, the Esplanade Reserve shall remain a dog off leash exercise area from 5.00 am to 8.00 am.

OFFICER'S RECOMMENDATION

That the Strategic and General Services Committee information report for January 2015 be received.


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SGS1501-2 HIGH STREET MALL REVITALISATION STRATEGY ECM Reference: 069/003 Disclosure of Interest: Nil Meeting Date: 21 January 2015 Previous Item: Nil Responsible Officer: Tom Griffiths, Manager Economic Development and

Marketing Actioning Officer: Tom Griffiths, Manager Economic Development and

Marketing Decision Making Authority: Council Agenda Attachments: 1. High Street Mall Tenancy Mix Strategic Directions

2. High Street Mall Promotional Brochure (draft) 3. High Street Mall Workshop report 4. Fremantle CBD Vacancy Audit Report

EXECUTIVE SUMMARY

The City of Fremantle’s Strategic Plan 2010–2015 contains clear goals and targets including a target to add 20,000 square metres of retail space to Fremantle over that five year period. To support achievement of this goal (and future goals of this nature), it is imperative that existing retail is also well supported and an operating environment exists that facilitates commercial prosperity for existing and prospective retailers in Fremantle. The term retail is used broadly to encompass all population-driven industries including not only retail, but also hospitality and personal services (e.g. hairdressers, tailors). The High Street Mall is at the heart of Fremantle’s city centre, connecting Kings Square to Market Street. Once a ‘hub’ of retail activity and home to national retailers and a diverse business mix, the Mall is now facing a range of challenges including high vacancies, a lacklustre tenant mix, an increasingly difficult and competitive retail landscape, low visitation and limited attractions. These issues are compounded by a disparate approach to tenancy leasing, a poor retail offer which limits visitation, no destination-oriented marketing to prospective tenants, poor quality public realm and infrastructure relative to other retail destinations in the Perth metropolitan area, and an overall lack of clarity regarding the Mall’s positioning and brand within the Fremantle market. As a result, the Mall’s three major property owners, together with the City, have been working collaboratively to develop a revitalisation strategy to ‘reposition’ the Mall within the retail and hospitality market so that it can become a relevant destination for retailers and visitors. The revitalisation strategy is comprised of the following components:

1. Place proposition: agreeing a strong, united vision and positioning for the Mall and translating this into a brand identity and marketing strategy focussed on attracting investment and high quality retail and hospitality tenants.

2. Retail mix: a strategic leasing approach that centres on the merits of the overall destination versus individual tenancies.

3. Branding and marketing: implementation of some ‘quick wins’ that focus on using empty spaces as well as events and programming during peak times.


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4. Leasing and tenant attraction: proactively approaching ‘on-brand’ tenants. 5. Public realm improvements: in parallel with the above, plan and implement

physical improvements to the Mall’s public realm. The property owners have made commitments to take collaborative action to achieve the agreed place proposition, retail mix, branding, and leasing strategy. To supplement those actions, the property owners have requested that the City upgrade the public realm of the High Street Mall early in the 2015/16 financial year to tie in with the redeveloped Atwell Arcade. A detailed upgrade concept would need to be developed in collaboration with the property owners in the next two-three months and is likely to include improvements to street furniture, bins, power, lighting, bicycle racks and shading, as well as the addition of entry statements and a feature attraction (e.g. water feature or public artwork). This report and its attachments provide rationale for the revitalisation strategy including the proposed Mall upgrade, information on Fremantle’s retail environment and detail on the place proposition, retail mix, branding, and leasing strategy. This report recommends that Council commits to upgrading the public realm and infrastructure of the High Street Mall early in 2015/16 financial year at a cost of no more than $275,000 (exc. GST). Delivering the upgrade to the public and private environment in unison demonstrates Council’s ability to work effectively with the private sector and to respond swiftly to opportunities as they arise. It is also a demonstrated response to increasing competition at other retail centres such as Garden City. The revitalisation strategy presents an opportunity for the City to demonstrate tangible outcomes to the community which will continue to build investor confidence in Fremantle. The revitalisation strategy also presents an opportunity for the City to use the High Street Mall upgrade as a forerunner to the imminent Kings Square redevelopment, and to provide sufficient time for the Mall to become established as a major retail node of Fremantle before other major developments in Fremantle are delivered.

BACKGROUND

Activity Centres Policy The State Planning Policy 4.2 ‘Activity centres for Perth and Peel’ includes the following points that describe a Strategic Metropolitan Centre (Fremantle’s current classification):

A retail offer which includes department stores, discount department stores, supermarkets and a full range of specialty shops.

Passenger rail and high frequency bus services. Major offices including some state government offices. An indicative service population of 150,000 to 300,000 persons. Commercial and residential growth that is optimised through appropriately-scaled

buildings and higher-density development in walkable catchments of centres. While it is recognised that the above points are intended to be used as guidelines and not strict rules, it is clear that if Fremantle is to reach its stated goal of being classified as a ‘Primary Centre’, which is a classification above a ‘Strategic metropolitan centre’, it must significantly strengthen the quality of its retail offer, among other things.


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Retail Model Plan 2010 In 2010 the City commissioned the preparation of a Retail Model Plan, which was defined as providing:

A vision for the level of retail development that is sustainable given the stated objectives of the City of Fremantle Strategic Plan 2010–2015.

Identified locations for development, taking into account linkages to existing retail, planned commercial and residential development, other anchors and the historical precinct of Fremantle.

Preferred location of ‘anchor‘ retailers. Key principles for effective retail precincts, including management structure and

marketing. Niche tenancy mix opportunities – point of difference. Strategies and timelines for development.

The Plan emphasises the importance of connecting Fremantle’s major activity nodes with the main axis of pedestrian activity. It also identifies several challenges for Fremantle’s retail industries including the physical separation and isolation of the attractions with the retail anchors, as well as some serious dead spots such as the High Street Mall where there is little activity. The Plan concludes that these factors seriously detract from the enjoyment of walking around Fremantle as a whole, and also leads to elements of anti-social behaviour that further compounds the problem. One of the recommendations of the Retail Model Plan was that the focus of the development should be around Kings Square, Adelaide Street and Queen Street. Figure 1 below shows the ultimate retail anchors and linkages in Fremantle recommended in the Plan. High Street Mall is central to these anchors and linkages. Figure 1: Ultimate retail anchors and linkages

Source: Retail Model Plan, 2010. Status of the High Street Mall The performance of the High Street Mall over the last several years has been poor and major retail tenants have left and not been replaced. Vacancy rates in the Mall have


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been unacceptably high over the past few years and at present, there are five long term vacancies in the Mall itself (out of 20 tenancies, 25% vacancy rate), and an additional six vacancies in close proximity. A January 2015 audit (Attachment 4) of the Central City’s retail vacancies conducted by the City found that there are 69 vacant street-level premises within central Fremantle (see Figure 2). Based on the total retail stock identified in the Retail Model Plan of 641, this equates to a current vacancy rate of 10.7%. While this vacancy rate compares relatively well with retail vacancies in the Perth metropolitan areas (12% or greater), efforts should be taken now by the City to address long-standing vacancy clusters. The retail audit identified a number of vacancy clusters – these are shown in Figure 2. The High Street Mall cluster is the most concerning due to the longstanding high vacancy rate, its central location and that it acts as a major pedestrian linkage between anchors. Figure 2: Central Fremantle retail vacancies, January 2015

Source: City of Fremantle, 2015. The reasons for the Mall’s underperformance are considered to be:

Absence of a cohesive vision for the Mall. Previously un-connected property owners. Lack of a collaborative leasing strategy among property owners. High shop vacancies. High rents relative to foot traffic. Outdated mall furniture, lighting and other public infrastructure. Increase prevalence of anti-social behavior due to the vacant tenancies.

Unsurprisingly, visitor perception of the Mall is poor. Figure 3 shows ‘City Central’ (primarily comprised of the Mall) as ranking poorly in comparison to other offerings with Fremantle. Figure 3: Visitor perception survey


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Source: City of Fremantle, 2013 Revitalisation strategy In response to this issue, the City (represented by Economic Development and Marketing Manager, and City Ward Councilor Rachel Pemberton) has been meeting regularly with the three owners of the adjacent properties to develop a cohesive revitalisation strategy. This report summarises that strategy and makes recommendations as to how the City can play its part in the sustainable revitalisation of the Mall.

COMMENT

With the assistance of place making consultants and with support from City Officers and Councilors, the owners have developed a strategy that defines the future vision for the High Street Mall. It is based on observations, desktop research, and workshop sessions with property owners and the City. It articulates the unique opportunities available for the Mall in the context of other destinations within Fremantle and outlines key actions and strategies to guide decisions for branding and marketing, leasing, destination development and public realm improvements.


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Holistic revitalisation of the High Street Mall will not happen immediately and will require a consolidated effort among property owners and the City, and a commitment to a united vision and leasing strategy. While some infrastructure improvements are required, it is recognised that the bigger issue is about achieving a substantial improvement to the tenant mix, attracting new investment and improving product quality and visitor experience.

While the Mall’s performance has declined over a period of years and its revitalisation will take some time, it is important that an intervention be made as soon as possible. Failure to act is likely to mean that the Mall will continue to slip towards poorer performance and arresting the slide later is likely to require even more intensive effort from stakeholders.

Revitalisation objectives Revitalisation objectives for the Mall were identified as:

1. Resurrect the Mall as Fremantle’s major shopping destination for a range of audiences.

2. Attract national retail brands to operate alongside successful local food, beverage and retail operators.

3. Introduce new activities and attractions in the Mall to encourage people to stay longer (i.e. a ‘third place’ behind home and work).

4. Deliver a comfortable and welcoming space through lighting, street furniture, interactive feature and landscaping.

5. Create social and economic activity at day and night time. 6. Achieve investment return for property owners and the City.

Revitalisation strategy Building on the success of other main street revitalisation projects, such as William Street in Northbridge and Oxford Street in Leederville, and as agreed in the workshops, the following approach is recommended:

1. Place proposition: agreeing a strong, united vision and positioning for the Mall and translating this into a brand identity and marketing strategy focussed on attracting investment and high quality tenants (responsibility of the owners).

2. Retail mix: a strategic leasing approach that centres on the merits of the overall destination instead of individual tenancies (responsibility of the owners).

3. Branding and marketing: implementation of some ‘quick wins’ that focus on using empty spaces as well as events and programming during peak times (responsibility of the owners and the City).

4. Leasing and tenant attraction: proactively approaching ‘on-brand’ tenants (responsibility of the owners).

5. Public realm improvements: in parallel with the above, plan and implement physical improvements to the Mall’s public realm (responsibility of the City).

Place proposition: A place proposition articulates the vision for a place and the reason why people would visit it. With a simple minded positioning statement and supporting place values, it sets the framework for what the place will become along with the type of experience that people will have when they visit the Mall. Articulating and agreeing upon a place proposition for the High Street Mall is the first step in shaping the strategic direction for its revitalisation. The recommended Place Proposition, positioning and values are outlined in Figure 4.


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Figure 4: Aspirational Place Proposition, High Street Mall

Source: PlaceMatch, 2014 Retail mix: In the context of the recommended positioning, the current retail mix requires significant improvement. The ultimate goal is to attract national fashion and other retailers back to the Mall and this will need to be underpinned by a business mix that offers a point of difference to the standard ‘shopping centre’ experience that is reflective of the unique Fremantle lifestyle, which is a visitor draw-card in itself. An indicative benchmark comparison for the Mall and its immediate surrounds is Oxford Street in Leederville where the business mix comprises: Retail (22%); Food, beverage and entertainment (57%); Commercial / services (17%); and Vacant tenancies (3%). As a general guide and in the context of improving the retail mix, property owners will aim to achieve a significant increase in food and beverage operators in the Mall, to approximately 50% of the overall mix. Other recommended improvements to the retail mix include:

Introducing a diverse, quality, local and moderately priced food offering. The food component should be located at key entry points on the corner of Market and High Streets, and High and Adelaide Streets, as well as facing onto the mid-section of the Mall, interspersed with retail and other compatible uses.

Attracting high quality ‘destination’ retailers, ideally from local operators in Fremantle and surrounds, with a quality product, strong reputation and loyal customer following. The ability to trade into the evening must be considered favourably. This component should comprise approximately 25-33% of the business mix.

Limiting global fast-food and convenience chains and franchises. Ultimately attracting high quality, mid-price point national retail fashion brands

such as Witchery, Kookai, Seed, Country Road, Live etc. Attachment 1 shows the current and aspirational retail mix.


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Branding and marketing: Attracting retailers back to the Mall after a considerable period of decline requires its strategic repositioning through a compelling brand which clearly articulates its offer, point of difference and personality. This brand, supported by sound business mix and leasing strategies will assist with tenancy attraction and customer attraction and retention. The brand is an essential asset that should lead creative and integrated marketing campaigns that promote High Street Mall as a destination to both prospective retailers and visitors – not a series of unrelated tenancies. The current approach to Mall branding includes: trading off square metre, location and price; single tenancy approach; no compelling brand or destination offer for the Mall; brand promise and personality not clear; and lack of quality marketing collateral. The recommended approach for branding the Mall is to:

Develop a destination brand that can be used for strategic and tactical marketing.

Leasing opportunities to be packaged under the brand. The brand should reflect consistent design, key message and language

and be reflective of the place proposition. Marketing should promote the destination, not single tenancies, to create

the impression of being part of something bigger. Brand application should include:

- Online / digital. - Physical and onsite (shop front, public space, hoarding etc.). - Brochure ware, advertising and other printed collateral.

A draft promotional brochure for the Mall has been produced and is included as Attachment 2. Leasing and tenant attraction: The existing approach to attracting tenants to the Mall is predominantly focused on traditional methods of shop front signage, display advertising (online / print) and generating interest / enquiry through database contacts. While these methods are relevant, a number of other tools are required to enable property owners to implement their vision. These are recommended to be:

Develop a leasing masterplan to guide the tenant mix for the Mall, which property owners and their representatives agree to and follow collaboratively.

Adopting a shopping centre mentality - using the leasing masterplan as a guide, property owners should work together to attract targeted tenants, noting that while there will always be an element of competition, the ‘bigger picture’ of creating a retail destination is important for the benefit of all stakeholders.

Strategic marketing – marketing tenancies as part of a destination with consistent brand and key messages.

On site marketing and brand presence – improve the appearance of ‘for lease’ signage, to be consistent with the new Mall brand.

Conduct a critical review of the group’s current leasing and tenant attraction methods, considering: database quality and ensuring all targets ‘fit’ with the vision for the Mall; effectiveness of advertising methods / spend; conversion rates and follow-through.

Setting criteria for property owners and leasing agents to work towards in attracting tenants including:


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- The quality of the proposed concept including: ‘fit’ with the Mall vision; ability of tenant to attract diverse target audiences; quality of offer and price point; fit-out plans and level of investment; ability of tenant to trade daytime and into the evening; understanding of the Fremantle area; operating hours, staffing and resourcing.

- Business plan: strategy; cash-flow; financial capacity; financial terms.

- Track record and experience - Organisation information: business structure and details of

individuals. Public realm improvements: Along with the current retail mix, the attractiveness of the public realm of the High Street Mall has been identified as a key issue. The following public realm improvements are recommended as part of a longer-term revitalisation plan. They are divided into two categories: 1. urgent improvements; and 2. desirable improvements. Urgent improvements

1. Improve the level of general amenity across the Mall including bike racks, shading, rubbish bins, and pet-friendly drinking fountains.

2. Introduce additional alfresco opportunities for new food and beverage tenancies to improve street activation, ensuring these are designed to respond to seasonal fluctuations. The current alfresco at Culley’s and Hush Espresso is well utilised and this should be leveraged. Key corner sites at the entrance to the Mall from Kings Square (currently souvenir shop) and Market Street (currently 7-11) are prime opportunities for this.

3. Replace current seating (steel stand-alone bench seating) with new contemporary seating which encourages group seating and communal activity. New locations for seating to be planned in conjunction with alfresco dining area and other improvements to ensure clustering of activity and creation of critical mass.

4. Capitalise on the intimate scale of the space through catenary lighting and unique feature lighting.

5. Create entry statements to the Mall from Kings Square and Market Street to capitalize on passing footfall – creating a sense of arrival.

6. Create a ‘non-retail’, pedestrian green space in the Mall – shaded, family friendly and high quality to increase dwell time.

7. Retain and enhance the Mall’s existing tree scape where possible and implement shaping and pruning to improve lines of sight to key attractions.

8. Plan the public realm in the Mall as a series of smaller, flexible areas that can ‘stand-alone’ or be interlinked and used as one, in the event of programmed activities such as performance or markets.

9. Prioritise way-finding signage as part of an integrated approach with the City to connect the Mall to its surrounding destinations (this will be included as part of a separate new initiative proposed for 2015/16 for improved way-finding across Fremantle).

10. Ensure the Mall is equipped to support ephemeral activation including adequate water, power, loading, access and egress etc.


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Desirable improvements

1. Install a key interactive piece of art (or other attraction) which becomes the Mall’s ‘calling card’ – opportunities include interactive water feature or lighting installations. A focus should be on the day / night use of this interactive feature to ensure it both creates and capitalizes on the evening economy.

2. Install high quality feature paving in the mall, or parts of the Mall. Programming and management of the space: A large part of the success of any space comes down to its management and programming. The property owners and the City have identified active programming within the Mall as a priority in the short term and in the longer term following public realm improvements. In the longer term, programming should align with school holidays with the aim of capitalizing on Fremantle’s visitor numbers. With a focus on family friendly activities, a number of opportunities exist to attract people to the space. These may be:

Food truck / food cart rumble – afternoon/evening program targeting a range of cuisines and price points.

Music performance – roving performers supported by small seating areas to watch impromptu performances.

Christmas, Easter, Valentine’s Day, Mothers / Father’s Day etc. – to link in with the broader City initiatives, targeting children and family.

Integration with Festivals. Outreach initiatives from the Arts Centre, Leisure Centre, Spare Parts Puppet

Theatre etc. Wherever possible, programming should be planned and managed in conjunction with the City to leverage existing activity, networks and resourcing within Fremantle. In terms of management of the Mall, the City’s Economic Development Coordinator will act as the point of contact for all issues related to managing the Mall and will work with other business units to solve problems and capitalise on opportunities as they arise.

RISK AND OTHER IMPLICATIONS

Financial

$175,000 plus GST to be included in the 2015/16 financial year budget for urgent improvements to the Mall. An additional $100,000 plus GST is to be included in the 2015/16 financial year budget for desirable improvements to the Mall. For Council’s information, the collective rates revenue in 2014/15 from the three property owners was $358,620 (for the properties adjacent to the Mall only). Legal

Nil Operational

If approved, the upgrade of the High Street Mall would be included as a new initiative in the 2015/16 financial year. Other priorities will need to be adjusted accordingly.


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Organisational

Nil

CONCLUSION

Productive working relationships between the major property owners presents a rare opportunity (for city centres) to control the tenancy mix and to curate the retail offering in a strategic and well considered manner. To facilitate this process, it is important that the physical aspects of the city create the right environment for commercial prosperity. Largely, this means strong and appealing urban design and effective place management. As part of a facilitated process, property owners have committed to undertaking various activities to improve the performance of the Mall. These are:

1. Endorsement of this revitalisation strategy. 2. Endorsement of the draft branding (Attachment 2). 3. Commitment to the leasing masterplan and aspirational leasing mix (Attachment

1). 4. Agreement to use one leasing agent, with national reach, to implement the leasing

masterplan and aspirational leasing mix. 5. Commitment to better presentation of vacant premises. 6. Immediately remove outdated signage such as those from vacated tenants. 7. Continue to improve shop fronts.

To supplement these efforts, the property owners have requested that the City upgrade the public realm of the Mall, separated into urgent improvements and desirable improvements. The upgrade would occur in the early months of 2015/16 financial year so that it can be aligned with the re-opening of the ground level of the redeveloped Atwell Arcade. The aspirational launch date for the ‘new’ High Street Mall has been set as early December 2015, which would include upgraded public realm (City), improved shop fronts (owners) and high-quality tenants (owners). Delivering the upgrade to the public and private environment in unison demonstrates Council’s ability to work effectively with the private sector and to respond swiftly to opportunities as they arise. The revitalisation strategy presents an opportunity for the City to demonstrate tangible progress to the community which will continue to build investor confidence in Fremantle. The revitalisation strategy also presents an opportunity for the City to use the High Street Mall upgrade as a forerunner to the imminent Kings Square redevelopment, and to provide sufficient time for the Mall to become established as a major retail node of Fremantle before other major developments (e.g. Woolstores shopping centre, Kings Square) are delivered.

STRATEGIC AND POLICY IMPLICATIONS

Strategic Plan 2010 – 2015 Strategic imperative: Economic Development, Strengthen Fremantle’s economic capacity. Strategic imperative: Urban Renewal & Integration, Provide a great place to live, work and play through growth and renewal.


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Economic Development Strategy 2011 - 2015

Strategic action area 1: Economic development leadership and collaboration Strategic action area 2: Urban form and infrastructure Strategic action area 3: Business capability and capacity Strategic action area 4: Marketing

COMMUNITY ENGAGEMENT

The City has worked closely with the owners of the three adjacent properties for a period of approximately six months. Additionally, visitor surveys for Fremantle as a whole conducted in 2013 were used as an input into this report.

VOTING AND OTHER SPECIAL REQUIREMENTS

Simple Majority Required


That the Council commits to upgrading the public realm and infrastructure of the Mall in 2015/16 financial year on the following basis:

1. That urgent upgrades to the Mall include improvements such as:

a. Entry statements at one or both ends. b. Improved public seating. c. Improved bicycle racks. d. Provision of more shaded areas. e. Better quality and more discrete rubbish bins. f. Improved alfresco area demarcation (e.g. planter boxes). g. Way-finding and signage for visitors. h. Improve lighting of public realm (e.g. catenary lighting). i. Up-lighting of buildings. j. Retain and enhance the Mall’s existing tree scape where possible and

implement shaping and pruning to improve lines of sight. k. Other elements (such as power supply) identified as being vital to the

performance of the Mall.

2. Council allocate $175,000 in the budget for urgent improvements with no requirement that the owners of the adjacent properties financially contribute to this component.

3. Council allocate $100,000 in the budget for desirable improvements. Desirable upgrades to the Mall include additional improvements such as:

a. A major feature attraction such as a water feature or public art piece. b. Feature paving of a much higher quality.


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4. Work to commence as soon as possible in the 2015/16 financial year with a target deadline of December 2015 to align with the re-opening of the retail component of the Atwell Arcade.

5. Design works and concepts for the upgrades are to be developed in consultation with the owners of the adjacent properties and agreed in writing prior to commencement of works.

6. The City of Fremantle enters into a Memorandum of Understanding with the

owners of adjacent properties to: i) Ensure that the City receives at least a $50,000 collective contribution

(i.e. additional 50%) for desirable improvements to the Mall to achieve a total budget of $150,000 for this component; and,

ii) Accomplish the articulated vision, positioning and tenancy mix of the

Mall as per Attachments 1, 2 and 3 by:

a. Promoting the (draft) new branding for the High Street Mall to prospective tenants.

b. Evolving and improving the tenancy mix when opportunities arise by replacing the existing ‘off-brand’ tenancies with those that help realise the articulated vision for the Mall.

c. Appoint one high-quality leasing agent with national contacts to implement the leasing strategy for all tenancies across the three properties.

d. Within two weeks of a retail vacancy occurring (and without a replacement tenant signed up) adding a pop-up shop, window display such as art, or another form of decoration to disguise the vacancy and improve the appearance of the Mall.

e. Immediately remove outdated signage such as those from vacated tenants.

f. Continue to improve shop fronts.

7. Updates on the overall performance of the Mall will be provided to Council at the end of the 2015/16 and 2016/17 financial years.

8. If Council are not satisfied with the progress made by the owners to honour their stated commitments, it will consider introducing a special area rate to recover the costs from the 2017/18 financial year.


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SGS1501-3 APPLICATION FOR NEW LEASE - LOT 39 DALY STREET, SOUTH FREMANTLE

ECM Reference: 049/008 Disclosure of Interest: Nil Meeting Date: 21 January 2015 Previous Item: Nil Responsible Officer: Glen Dougall, Director City Business Actioning Officer: Nadine Hume, Property Services Administrator Decision Making Authority: Council Agenda Attachments: Letter of Application from Humich Nominees Pty Ltd &

Anilia Pty Ltd Location Map of proposed lease area (Daly Street section only).

EXECUTIVE SUMMARY

The City has received a submission from Humich Nominees Pty Ltd & Anilia Pty Ltd for permission to develop a car park on a portion of 39 Daly Street, South Fremantle. This item is to request Council to consider a Lease agreement with Humich Nominees Pty Ltd & Anilia Pty Ltd for a portion of Lot 39 Daly Street, South Fremantle with an area of 1350m2.

BACKGROUND

The former South Fremantle landfill site was operational between 1931 and 1986. The Department of Environment Regulation has classified the site as “contaminated – remediation required” under the provisions of the Contaminated Sites Act 2003. The site received a wide range of waste including domestic, industrial and hazardous waste. The site is located to the west of Hampton and Cockburn Roads, 2.4km of the Fremantle City Centre and covers an area of 19.43 hectares. The area was split into three recognised sites being Hollis Park, Sandown Park and Daly Street. The Daly Street area was originally a limestone quarry which was excavated from 1939 – 1956. Waste was disposed of at this site prior to Sandown Park site operation, with general domestic waste disposal ceasing in 1958. Once Sandown Park reached capacity in 1980, Daly Street was again used as landfill from 1980 to 1991. There is little information on the level of the base of the waste for this area. However, the inferred depth is typically between 5m to 10m. At one monitoring location, waste was approximately 2 to 3m from the surface. At a second monitoring location, waste was identified at ground level. The types of waste known to have been disposed of within the Daly Street section of the site include domestic waste, bulk trade waste and fly ash.


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As a former landfill site, environmental and engineering considerations need to be addressed in the formulation of development proposals. Methane and carbon dioxide generation from the decomposition of organic matter and land subsidence resulting from the movement of subterranean fill materials are the primary concerns. The City’s Field Services and City Works staff ensure that periodic environmental monitoring and ongoing site management is performed to manage public health and safety risks to the satisfaction of a DER accredited Contaminated Sites Auditor. Humich Nominees Pty Ltd & Anilia Pty Ltd has requested the use of 1580m2 for the development of a car park which will be used by the shopping centre located on the corner of Daly Street and Hampton Road. The area is on the outer edge of the former landfill site.

COMMENT

Due to the classification of the site as “contaminated – remediation required” by the Department of Environment Regulation, a potential lease agreement will need to be subject to strict conditions. The applicant shall engage the services of a qualified environmental consultant to perform an investigation and prepare a report, at their cost, demonstrating the site can be safely developed as a car park. The environmental consultant’s report will need to be audited by a DER approved contaminated sites auditor who will make a recommendation to the Department of Environment Regulation in regard to the quality of the report and the suitability of the site as a car park. This process will need to be undertaken to the satisfaction of the Department of Environmental Regulation prior to the applicant submitting a development application to the City’s Planning Department. As there will be a cost to the applicant to undertake this work, they have requested a lease prior to any financial expenditure. The Lease will include a “Condition Precedent” clause which will outline the conditions that will render the Lease null and void if they not be completed or approved. The Essential Lease terms and conditions are as follows; Land Description. Portion of Lot 38 on Diagram 20161 Volume 1192 Folio 393 (a surveyed plan to be attached to the lease) Property Description Land Registered Proprietor City of Fremantle


Page 17

Site Area. Daly Street, South Fremantle – 1580m2 Lease Commencement Date TBA Lease Term Ten (10) years Annual Rent $10m2 = $15,800 + GST To be payable in equal monthly amounts Rent Review Annually on the anniversary of the Lease based on Consumer Price Index (CPI) with the exception of every fifth year which will be based on independent market valuation (the market valuation will be based on vacant land with no improvements). Permitted Use Car park Outgoings To be charged on demand, including but not limited too;

Council Rates Emergency Service Levy Land Tax Water Rates/Usage (if applicable) Electricity (if applicable)

Legal Fees for New Lease Each party will be responsible for their own costs. Special Conditions

1. The Lessee acknowledges that the proposed site is classified as “contaminated – remediation required” by the Department of Environment Regulation.

2. The Lessee will be responsible for the cost of all improvements to the land including but not limited to; development application and approvals, cost of development, statutory approvals required as conditions to the development.


Page 18

3. All contractors used for the purpose of investigation and approval required by the Department of Environment Regulation and any further monitoring of the area relating to the contaminated land, for the term and further term of the Lease, will be contractors approved and/or recommended by the Lessor.

4. The Lessor or its agents will be entitled to enter the site after giving reasonable notice in writing, to conduct inspection of the site in relation to the registered contamination.

5. The Lessee will be required to take direction from the Lessor regarding any actions necessary as to maintaining this contaminated site for the term and further term of the Lease.

Condition Precedent The Lease is subject to the following Condition Precedents to be undertaken by the Lessee;

1. The commission of an Environmental Report prepared by a suitably qualified environmental consultant on the leased site.

2. The Environmental Report being audited by a Contaminated Sites Auditor accredited by the Department of Environment Regulation.

3. The proposal, including the Environmental Report being approved by the Department of Environment Regulation.

4. A management plan to be prepared for the site to the satisfaction of the Lessor. 5. Development Application approval.


Financial

The proposed rent is based on a market valuation of contaminated vacant land with the determination being $10m2. As the applicant has requested an area of 1580m2 the rent will be $15,800pa + GST. All investigations related to the viability of the proposal and any costs associated with the development process and ongoing maintenance will be at the cost of the Lessee. Legal

A lease agreement with Humich Nominees Pty Ltd & Anilia Pty Ltd must comply with the WA Local Government Act, Commercial Tenancy (Retail Shops) Agreements Act 1985 and the conditions outlined by the Department of Environment Regulation regarding the management and development of a contaminated site. Operational

City Officers will finalise a lease based on the essential terms and conditions outlined within the resolution of this item. Organisational

Nil


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CONCLUSION

As a registered contaminated site the Daly Street site has limited uses. The cost of any investigation and development of this proposal will be at the cost of the Lessee with no impact on the City’s budget. The proposed Lease terms ensure that the lease is made void should the Lessee be unable to meet the expectations of a Contaminated Sites Auditor or the Department of Environment Regulation and fail to obtain approval to develop the site into a car park. Should the applicant obtain all necessary statutory approvals and proceed with the development, the City will gain the benefit of rental income from a site that is currently not being utilised.


Nil


Nil




Page 20


For Council to approve a Delegated Authority to the Chief Executive Officer to finalise a Lease with Humich Nominees Pty Ltd & Anilia Pty Ltd based on the following essential terms and conditions; Land Description. Portion of Lot 38 on Diagram 20161 Volume 1192 Folio 393 Property Description Land Registered Proprietor City of Fremantle Site Area. Daly Street, South Fremantle – 1580m2 Lease Commencement Date TBA Lease Term Ten (10) years Annual Rent $10m2 = $12,640pa + GST To be payable in equal monthly amounts Rent Review Annually on the anniversary of the Lease based on Consumer Price Index (CPI) with the exception of every fifth year which will be based on independent market valuation (the market valuation will be based on vacant land with no improvements). Permitted Use Car park


Page 21

Outgoings To be charged on demand, including but not limited too;

Council Rates Emergency Service Levy Land Tax Water Rates/Usage (if applicable) Electricity (if applicable)


1. The Lessee acknowledges that the proposed site is classified as “contaminated – remediation required” by the Department of Environment Regulation.

2. The Lessee will be responsible for the cost of all improvements to the land

including but not limited to; development application and approvals, cost of development, statutory approvals required as conditions to the development.

3. All contractors used for the purpose of investigation and approval required

by the Department of Environment Regulation and any further monitoring of the area relating to the contaminated land, for the term and further term of the Lease, will be contractors approved and/or recommended by the Lessor.

4. The Lessor or its agents will be entitled to enter the site after giving reasonable notice in writing, to conduct inspection of the site in relation to the registered contamination.

5. The Lessee will be required to take direction from the Lessor regarding any

actions necessary as to maintaining this contaminated site for the term and further term of the Lease


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SGS1501-4 PROPOSED UPGRADE AND DEDICATION OF PRIVATE RIGHT OF WAY NO. 62 (TRUSTING LANE) - SURVEY RESULTS

ECM Reference: 091/015 Disclosure of Interest: Nil Meeting Date: 21 January 2014 Previous Item: SGS 1408-8, SGS1406-4, SGS 0602-3 and SGS0605-7 Responsible Officer: Paul Garbett, Acting Director Strategic Planning and

Projects Lionel Nicholson, Acting Director Infrastructure and Project Delivery

Actioning Officer: Phillip Adams, Manager Infrastructure Approvals Decision Making Authority: Council Agenda Attachments: Nil

EXECUTIVE SUMMARY

At its meeting of 27 August 2014, Council considered a request from the Perth Diocesan Trustees (PDT) for the upgrade and dedication of the private right of way (ROW) number 62, known as Trusting Lane. Council resolved to:

'Survey all adjoining land owners of Trusting Lane to seek their support of contribution towards cost in accordance with the policy.'

Upgrade and dedication of private ROW's is covered in Council's planning policy DA15. In particular, section 3.6 relates to the funding of upgrades and dedication where a ROW is deemed to require upgrading (prior to dedication as a public road). The policy notes:

Where a ROW is deemed to require upgrading, the Council may choose to apply a special (specified) area rate to all properties adjoining the ROW in order to raise sufficient monies to fund the upgrading (which may include loan repayments) of the ROW in accordance with the plan subject to: A minimum of 75% of all adjoining landowners are in agreement to the

application of the special (specified) area rate, and The special (specified) area rate shall not apply for a period greater than

10 years

To establish ratepayer willingness to contribute to the ROW upgrade, a survey of the 31 adjoining landowners was undertaken. Of the 18 replies received, only 2 (11% of replies received) were willing to contribute funding, clearly demonstrating that ratepayers are not prepared to fund this private ROW upgrade.


Page 23

BACKGROUND

The private ROW (Trusting Lane) is currently in the ownership of the Perth Diocesan Trustees (PDT) Anglican Church and being the former owners of nearby Pitts Lane, Mulberry Lane and Farrier Lane. Following various approaches by PDT for council to fund an upgrade to the Trusting Lane ROW, council considered the request in item SGS 1408-8 of 27 August 2014. It adopted an approach to review the request in line with council planning policy DA15, but sought a survey of adjoining landowners to confirm the level of preparedness for ratepayers to fund the upgrade.

COMMENT

Technical Services officers undertook a survey of the 31 adjoining ratepayers to establish the willingness to contribute funding for the ROW upgrade, with the survey being sent out on 7 November 2014. Of the total of 18 responses (58%) received by 23 December 2014, 2 indicated agreement to contribute to the upgrade. This represents an agreement rate of 11%. It is noted that even though the survey did not receive a 100% response rate, the number of non acceptances precludes the possibility of achieving a 75% agreement rate for all adjoining landowners to fund the upgrade (as required under the policy DA 15). Based on the replies received, it is clear that the ratepayers do not support funding the upgrade.


Financial

There are no financial implications if council continues to apply the requirements of policy DA 15 to the issue of upgrade and dedication for Trusting Lane, and for other private ROWs. Legal

Nil Operational

Nil Organisational

Nil

CONCLUSION

The survey has established the lack of support for ratepayer funding of this private ROW upgrade.


Page 24


Nil


The survey was conducted to include all those property owners adjoining Trusting Lane. The owners engaged as part of this survey will be advised in writing of the council resolution in relation to this item.




That Council;

1. receive the results of the survey identifying a lack of ratepayer support for funding of right of way number 62 (known as Trusting Lane) upgrade.

2. not approve the transfer of ownership of right of way number 62 (known as

Trusting Lane), Fremantle from the Perth Diocesan Trustees to the City of Fremantle.

3. advise ratepayers of the outcome of the survey results. 4. advise the Perth Diocesan Trustees of the outcome of Council's resolution.


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SGS1501-5 AWARD OF TENDERS FCC 426/14 AND FCC 432/14 - LEIGHTON BEACH CHANGE ROOMS AND KIOSK

ECM Reference: 135/001 Disclosure of Interest: Nil Meeting Date: 21 January 2015 Previous Item: Nil Responsible Officer: Lionel Nicholson, Acting Director Infrastructure and

Project Delivery Actioning Officer: Samuel Bryce, Manager City Assets Decision Making Authority: Council Agenda Attachments: Nil

EXECUTIVE SUMMARY

Tenders numbered FCC 426/14 and FCC 432/14 were invited for the construction of the Leighton Beach change rooms and kiosk. As a result of the tender evaluation process, the City’s internal Major Procurement Approval Panel has endorsed the recommendation that the contract be awarded to CPD Group. However, the tendered prices for the works mean that Council will need to approve additional funding for the current financial year of approximately $222 000, together with a further endorsement for a commitment to prioritise $364 000 for the 2015/16 financial year. These funds will need to come out of loan sources.

BACKGROUND

The change rooms were separately tendered out as number FCC426/14. Tenders were invited in the West Australian Newspaper on Wednesday 3 September 2014 and closed on Friday 3 October 2014. Offers for tender FCC426/14 were received from the following:

CPD Group (conforming tender) CPD Group (alternative tender) Robinson Buildtech Shelford Constructions Western Projects

The kiosk was separately tendered out as number FCC432/14. Tenders were invited in the West Australian Newspaper on Wednesday 5 November 2014 and closed on Friday 5 December 2014. Offers for tender FCC432/14 were received from the following:

Shelford Constructions


Page 26

Robinson Buildtech McCorkhill Constructions CPD Group

COMMENT

Primary considerations for this project were; General The site holds both cultural and ecological significance; Cultural Planning of the project embraced the need to sustain and augment the pre-existing community uses through the provision of public facilities and access in the now redeveloped beachfront. Culturally, four principles were fundamental to the project;

Connecting the project in the context of the redevelopment and in the context of coastal access generally.

Providing universal access to new works in line with Councils' Disability Access and Inclusion Plan.

Providing additional recreational free space in association with the recently provided spaces particularly for seating and the kiosk.

Providing new and augmented change, showers and toilets in a contemporary format including family and universally accessible facilities.

Ecological Through ecologically sustainable design, planning embraced the need to provide a project that is ecologically sustainable. This is proposed as;

conservation and restoration where practical of the indigenous dune environment through responsive development form/orientation and regenerative landscape

the management of water resources to ensure appropriate outcomes includes rainwater management as being the retention of dune soakage that pre-existed any development

optimising continuing management through the inclusion of: single point, automatically controlled secured access

optimizing continuing management and inclusion of appropriate construction technology that minimizes maintenance and whole of life cost.

On looking at and optimizing water usage for this area, it was found that the use of grey water collection and reuse systems unsuitable for the project, however the project has included water conservation strategies that incorporate;

efficient apparatus that reduces flow water through fixtures and fittings automatic shut off timers and dual flush settings to minimise water consumption stormwater soakage into the planted landscape maintaining the natural condition

where practical signage and awareness information for users


Page 27

hydraulic services installations that accommodate the future inclusion of active water resource management (grey and black water drainage is separate).

Evaluation of both tenders was based on an 80% weighting for the qualitative criteria and a 20% weighting for the assessed tender price. The qualitative criteria included:

demonstrated understanding/methodology – 20% skills and resource– 20% relevant experience – 20% references – 20%

The evaluation for tender FCC 426/14 is noted in the table below:

Based on the tender evaluation, it is considered that the CPD Group (alternative –a conforming tender, but involving the use of specialist nominated subcontractors) tender provides the best value for money. The evaluation for tender FCC 432/14 is noted in the table below:

Service Delivery Plan and Relevant

Experience

Key Personnel, Skills and Resources

Demonstrated Understanding

and Methodology References Price Total Score

Quoter/Tenderer (Company Name) 20 20 20 20 20 100

CPD Group

(conforming) 16.5 18 17 15 18.1 84.6

CPD Group

(alternative) 16.5 18 17 15 20.0 86.5

Robinson Buildtech 12.5 15.5 12 12.5 15.2 67.7

Shelford Constructions 17 18.5 18 17 13.8 84.3

Western Project Pty

Ltd 16.5 18 17.5 16 13.5 81.5

Service Delivery Plan and Relevant

Experience

Key Personnel, Skills and Resources

Demonstrated Understanding

and Methodology References Price Total Score

Quoter/Tenderer (Company Name) 20 20 20 20 20 100

Shelford Constructions 17 18.5 17 17 13.8 83.3

Robinson Buildtech 15.5 16.5 15 13 16.3 76.3

Mccorkell

Constructions 17.5 16 16 17 16.7 83.2

CPD Group 16 17 18 15 20.0 86.0


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Based on the tender evaluation it is considered that the CPD Group tender provides the best value for money. Both recommendations for tender award have been endorsed through the Major Procurement Panel meetings.


Financial

The recommended tender amounts are $1 338 362 (ex GST) for FCC 426/14 and $316 407 (ex GST) for FCC 432/14. The current approved infrastructure buildings budget for the works is $1 200 000, with an additional $582 000 budgeted for the landscaping component of the total Leighton Beach project. It is expected that $282 000 of the landscaping budget can be validly charged for the hard landscaping concrete works included in these tenders. However, with current actual expenditure and other commitments already made on design and investigations, an additional $586 000 in budget will be required if the works as currently tendered are to be awarded. This is with the recognition that infrastructure external works alone are $500 000, as none of the original infrastructure can be compliantly utilised in its current form. Assuming that works are to proceed, the project is expected to be completed over the next 8 months, with works anticipated to be completed within the current financial year approaching 80% of the tendered amount. That being the case, an additional $222 000 will be required for the 2014/15 year and $364 000 for 2015/16. It is expected that loan funds will be required to finance these budget requirements. Legal

Nil. Operational

The existing facilities at Leighton Beach are not fit for purpose and do not meet service levels both strategically or operationally. Organisational

Nil

CONCLUSION

CPD Group is recommended to be awarded both tenders numbered FCC 426/14 and FCC 432/14, with works to commence in January 2015 over an 8 month construction timeframe. CPD Group meets the quantitative and qualitative requirements outlined by the City, providing the best value for money and level of experience for the expected works.


Page 29

The proposed acceptance of the recommended tenderer for both tenders was endorsed through the City's Major Procurement Panel meetings. As the final tendered rates and expenditure to date exceed the available budget, an additional $222 000 will be required for the current financial year and $364 000 will need to be listed for commitment for 2015/16. These will be funded through loan funds.


Nil


Substantial community engagement with stakeholder groups have been completed prior to tender preparation.


Absolute Majority Required


That Council;

1. accepts the tenders submitted by CPD Group under Tender FCC 426/14 (Leighton Beach change rooms) for $1 338 362 + GST, and tender FCC 432/14 (Leighton Beach kiosk) for $316 407 + GST.

2. approves a budget of $1 422 000 (loan funded) for the Leighton Beach

change rooms and kiosk budget for 2014/15. 3. endorses funding of $364 000 (loan funded) to be listed in the 2015/16

budget for the expected remaining project works.


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SGS1501-6 PERTH WATER TRANSPORT PTY LTD - APPLICATION FOR NEW LEASE

ECM Reference: L015 Disclosure of Interest: Nil Meeting Date: 21 January 2015 Previous Item: Nil Responsible Officer: Glen Dougall, Director City Business Actioning Officer: Nadine Hume, Property Services Administrator Decision Making Authority: Council Agenda Attachments: Application for new Lease – Perth Water Transport Pty

Ltd Draft Lease – Perth Water Transport Pty Ltd Draft Sub Lease – Perth Water Transport Pty Ltd and Letter of Support – The Kiosk

EXECUTIVE SUMMARY

The City has received an application from Perth Water Transport Pty Ltd the lease holder of East Street Jetty at 124-126 Beach Street, Fremantle for a new Lease and Sub Lease.

BACKGROUND

The City entered into a lease with Tony Dilatte for East Street Jetty 124-126 Beach Street, Fremantle for a term of Five (5) years effective from 1 July 1997 with two further terms of five (5) years each effective from 1 July 2002 and 1 July 2007. The leased area includes the small ticketing office and car park (a total of 4233m2) with the permitted use being “ticket and booking office and parking area relating to Rottnest Island Ferry and Swan River Cruise Services”. Although the car park is part of the leased area the City manages the car park as “Car Park 1” and retains the income generated. On 12 September 2007 Tony Dilatte assigned the lease to Insight Corrosion Consultants Pty Ltd via a Deed of Assignment. Insight Corrosion Consultants Pty Ltd went into voluntary receivership in 2009 and assigned the lease to Perth Water Transport Pty Ltd (PWT) effective from 6 November 2009. At the time the City granted two further terms of five (5) years each effective from 1 July 2012 expiring 30 June 2017 and 1 July 2017 expiring 30 June 2022. PWT are the joint partnership of Rottnest Express and Captain Cook Cruises. The current rent return for this lease is $19,323.51pa + GST with the annual rent review based on whichever is greater between market valuation and consumer price index (CPI). The market value of the premises is lowered by the fact the City retains the income generated from the car park.


Page 31

Since the assignment of the Lease to PWT the ticket office on site has not been utilised. Captain Cook Cruises does dock on the jetty over the weekend and sometimes during the week however there is limited usage by the Lease holder. Patrons to the Kiosk opposite to these premises utilise the car park otherwise it generates little use. Main Roads is currently using a section of the car park as a set down area while undertaking repairs on the bridge. They have entered into an agreement directly with PWT who are receiving some financial remuneration for this based on the area used and rent charged by the City to PWT.

COMMENT

PWT have proposed to redevelop the site next to the ticket office to develop a hospitality venue to cater for local residents, visitors and ferry patrons. The activation proposed includes reinstating ferry services to the site and development of a small bar café with alfresco area. There is will also be a parking area that allows unique food vehicles. For the level of investment required to undertake this proposal the Lessee is proposing to surrender the lease further term effective from 1 July 2017 and requesting a new lease containing a suitable permitted use, with a term of five (5) years effective from 1 July 2017 with two further terms of five (5) years each. As the City, under the current lease terms, retains the income generated from the car park the leased area will be decreased to the portion of land required for the development as defined in the attached plan in the draft lease (Annexure 1 – Premises Plan, page 79 of the draft lease). An artist’s interpretation of the proposed concept has been included in the Lessee’s application. Should the Council approve a new lease the Lessee will be required to lodge a development application and appropriate liquor licensing application. The Lessee hopes to undertake the development approval and liquor license processes during the remaining tenure of the current Lease. The draft Lease outlines the parameters of the liquor license that can be applied to the leased premises with the following clause under Item 9(2) Additional terms and conditions; “2. Application for liquor licence and compliance with liquor licence conditions

(1) The parties agree that the Lessee shall apply for a small bar licence under section 41(1aa) of the Liquor Control Act 1988. In the event that the Lessee does not obtain a small bar licence within 1 year from the Commencement Date, the Lessee may continue to occupy and use the Premises for the Permitted Use of “Restaurant and Ferry Ticket and Booking Office” only. In the event the Lessee does obtain a small bar licence within 1 year from the Commencement Date, sub-clause (2) shall apply.

(2) It is a condition of this Lease that the Lessee comply with the following conditions

of its liquor licence:


Page 32

(a) The Lessee will be permitted to sell and supply liquor in accordance with the

provisions of section 41(1aa) of the Liquor Control Act 1988 as it relates to small bar licences.

(b) The sale of packaged liquor for consumption off the licensed premises is prohibited.

(c) The small bar licence will be for a maximum of 120 persons and patrons must not exceed this number.

(d) Food shall be available to patrons during all trading hours. (e) The selling or supplying of beverages in a such a way that would encourage rapid

consumption of liquor is prohibited including but not limited to unadulterated spirits or liqueur in a shot glass, drinks known as 'laybacks', shots', 'shooters', 'test tubes', 'jelly shots', 'blasters' or 'bombs'.

(f) No liquor is to be supplied mixed with energy drinks. For the purpose of this condition 'energy drink' has the same meaning as formulated caffeinated beverage within the Australia New Zealand Food Standards Code with a composition of 145mg/L of caffeine or greater.

(g) A range of non-alcoholic and low strength alcohol drinks will be available during all trading hours.

(h) A closed circuit television video ("CCTV") surveillance system able to identify individuals and showing times and dates must be in place and operational. The CCTV system must comply with the requirements as identified in the Director's Policy 'Security at Licensed Premises'. It is expected that the system will provide and record continuous images of the entrances and exits to the premises during normal trading hours and until one (1) hour after trading ceases. Images recorded via the CCTV system must be retained for at least twenty eight (28) days and must be made available for viewing or removal by the Police or other persons authorised by the Director.

(i) Entertainment and music on the licensed premises is to be maintained at a volume that allows normal conversation except in the case of a private function or special event.

(3) In sub-clause (2) the term “licensed premises” means the premises as described

in the liquor licence issued to the Lessee.

(4) The Lessee shall indemnify and keep indemnified the Lessor from and against any breach of the Liquor Control Act 1988, Food Act 2008, Liquor Control Regulations 1989 or the liquor licence or permit or any conditions imposed thereupon for which it may be liable as the owner of the Premises.”

As the development and activation of the area is the purpose of this lease request the following special conditions have been added to the draft Lease;

1. “Redevelopment of Premises

(1) The Lessee covenants and agrees with the Lessor to undertake and complete a redevelopment of the Premises as described in the Lessee’s Proposal annexed hereto as Annexure 2 (Development) by no later than two (2) years from the Commencement Date and otherwise:


Page 33

(a) in accordance with plans approved by the Lessor;

(b) to the reasonable satisfaction of the Lessor;

(c) at the Lessee’s sole cost and expense;

(d) using new materials, unless otherwise approved by the Lessor, subject to the parties’ acknowledgement that recycled materials may be used to improve the environmental performance of the building, provided such materials are both structurally sound and aesthetically appropriate;

(e) in a proper and workmanlike manner; and

(f) in accordance with the Building Code of Australia, any applicable Australian

Standard and any building permit issued by the Lessor as a permit authority under the Building Act 2011.

(1) The Lessee covenants and agrees to obtain at its expense all necessary statutory

approvals for the Development prior to commencing construction.

(2) If the Lessee does not commence the Development within two (2) years from the Commencement Date, then First Further Term and Second Further Term shall be forfeited and the Term of the Lease shall determine upon expiration of the initial five (5) year Term.”

As the premises will not be managed under the company name of PWT a Sub Lease will be required. The Sub Lessee will be Governor Fitzgerald Holdings Pty Ltd with the Directors being Scott Bailey and Timothy Crosland. PTW have discussed the proposal with both the Department of Lands and Swan River Trust and received a positive response but the lease and sub lease will require both departments approval. City Officers have requested “in principle” support from the Department of Lands (DoL) but have been advised that as the permitted purpose of the proposed lease is “Small Bar, Restaurant and Ferry Ticket and Booking Office” this is outside of the parameters of the Management Order over Reserve 37088 which is “Ferry Terminal and Parking”. DoL’s internal policy regarding the leasing of Reserves by Local Government dictates that if a portion of the reserve is used for commercial operations outside of the permitted use of the Management Order that section of land is exercised from the Management Order and leased directly to the City by the State of WA under section 79 of the Land Administration Act, at a portion of market rate. This is determined by a Landgate market valuation. In the case of PWT’s proposal only the section of land that contains the small bar and restaurant will be subject to market rate as the ticket office remains within the permitted use of the Management Order.


Page 34

DoL can proceed with the exercising the portion of the land at the request of the City. All costs associated with exercising the land, including but not limited to Landgate registration and survey preparation will be at the cost of the City. In turn the costs will be recovered from PWT.


Financial

The rent will be determined by an independent market valuation to be commissioned by the City within six months of the Lease commencement date. The valuation will be based on the permitted use under the Lease conditions, vacant land and the ticketing office already present on the site. The proposed permitted use is outside of the Management Order’s permitted use therefore the Minister for Lands will charge the City a rent of 25% market rate as determined by a Landgate valuation. As there are no river services offered from this jetty the use of the car park is minimal with the City generating $38,164 for financial year 2013/14. The site has 99 bays available in Car Park 1 with bay fees costing $1.30 per hour. Based on these figures, the City received an average of $104.55 per day in 2013/14 equating to one hour parking for 80 bays which is low level use. With the reinstatement of the site as a ferry terminal and the development of a hospitality venue it is hoped that the car parks use will significantly increase. For a point of contrast, calculations based on the use of 99 bays at four hours per day equates to $396.00 per day/$144,540.00 per annum. These figures are conjecture only on the basis of high level use. Legal

The lease has been drafted to comply with the WA Local Government Act 1995 and Commercial Tenancy Act WA 1985. The Management Order vested to the City by the Minister for Lands give the City the power to Lease any portion of the land for a term not exceeding 21 years, subject to the Minister for Lands consent. In the case of Reserve 37088 the lease will be subject to the Minister for Lands and Swan River Trust approval due to the sites close location to the Swan River. The Lease with PWT will also be subject to the City entering into a Lease with the State of WA for the portion of Reserve exercised from the Management Order. This in essence will mean that any agreement between the City of Fremantle and PWT will be a determined as a Sub Lease when finalised and the agreement with PW T and Governor Fitzgerald Holdings Pty LTd a Sub Sub Lease. Operational

Nil


Page 35

Organisational

As the permitted use of the new lease is outside the parameters of the Management Order over the Reserve the portion of land to be leased to Perth Water Transport Pty Ltd will be exercised from the Management Order and Leased to the City with a rent of 25% market rate as determined by a Landgate valuation. DoL will undertake the necessary action to arrange a Lease between the State of WA and the City once the draft Lease between the City and PWT and draft Sub Lease between the City, PWT and Governor Fitzgerald Holdings have been approved by Council. This process will take approximately six to eight weeks to finalise.

CONCLUSION

Even under the management of Insight Corrosion Consultants this site was used minimally. The lack of activation has caused the site to become a point where river users dump their rubbish resulting in the City receiving complaints of broken bottles and overflowing bins. PWT proposes a positive activation plan with the revitalisation and development of the site and reactivation of Rottnest Ferry, Captain Cook and other river services. This will mean onsite management and possible increase in City revenue generated from the Car Park 1.


Nil


The Lessee will undertake required community engagement when undertaking the liquor licensing process. The Kiosk, which is located at 123 Beach Street, directly opposite the ferry terminal, has indicated support for PWT’s proposal as outlined in attachment 4 of this item.




Page 36


Council approve 1. The City of Fremantle to enter into a Lease with the State of Western Australia

for a portion of Reserve 37088 to be exercised from Lot 1989 on Deposited Plan 184292 and being the whole of the land in Crown Land Certificate of Title Volume LR3140 Folio 593

2. Approve the Draft Lease as attached with the Strategic and General Services

Committee agenda attachments of 21 January 2015 between the City of Fremantle and Perth Water Transport Pty Ltd, Anthony Charles Baker, John Hayward Goodbody, Scott Anthony Bailey and Guy Franklin Bailey.

3. Approve the Draft Sub Lease as attached with the Strategic and General

Services Committee agenda attachments of 21 January 2015 between the City of Fremantle, Perth Water Transport Pty Ltd, Anthony Charles Baker, John Hayward Goodbody, Scott Anthony Bailey and Guy Franklin Bailey and Governor Fitzgerald Holdings Pty Ltd, Scott Anthony Bailey and Timothy Crosland.


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SGS1501-7 2 PHILLIMORE STREET, FREMANTLE - NEW LEASE ECM Reference: 049/008 Disclosure of Interest: Nil Meeting Date: 10 December 2014 Previous Item: Nil Responsible Officer: Glen Dougall, Director City Business Actioning Officer: Nadine Hume, Property Services Administrator Decision Making Authority: Council Agenda Attachments: Expression of Interest

Accepted Application – David Anthony & Alex Gilliam Planning Concept Proposed Lease Plan

EXECUTIVE SUMMARY

This item is for Council to consider an appropriate length of lease tenure for 2 Phillimore Street, Fremantle (Weighbridge Station) and approve Delegated Authority to the Chief Executive Officer to finalise a Lease between the City of Fremantle, David Anthony and Alex Gilliam based on essential terms and conditions set out in this item.

BACKGROUND

The City advertised for expressions of interest for the heritage Weighbridge Station located at 2 Phillimore Street, Fremantle. The scope was for groups, organisations, businesses or individuals to activate the building and take financial responsibility for all costs associated with restoration of the infrastructure, additional service requirements, planning approval and statutory requirements. The Weighbridge Station was historically used as entrance to the Fremantle Ports where goods and containers were weighed prior to entry. The building consists of two rooms with separate entrances totalling a combined area of 24.63m2. The property is registered on the Heritage Register and controlled by a Management Order in the name of the City of Fremantle giving the power to lease or licence to a term no more than twenty one (21) years. The City received four submissions that were short listed and given a period of six weeks in which to complete due diligence. Of the three applicants that confirmed interest in progressing with their submission the application from David Anthony & Alex Gilliam was selected to proceed with further negotiations.

COMMENT

The lease applicants proposal is to transform the Weighbridge Station into a New York style speak easy small bar and café with the maximum number being 75 patrons. The applicant has advised that should the liquor licence not be successful that they will activate the premises as a café.


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The Weighbridge Station is in need of complete restoration works with no current connection to water or sewer. The premises were offered in an “as it” condition through the Expression of Interest advertisement. The preliminary estimate for the works required, which include the restoration of the heritage building, connection to required services, additional infrastructure including toilet facilities, totals $398,250. To enable the rear of the building to be utilised as an alfresco in conjunction with the front area, the proposed redevelopment includes a portion of area outside of the defined land of the Weighbridge Station. This land is Road Reserve and due to this a separate Lease will be required subject relevant authority approval. The City has proposed a Lease term of fifteen (15) years. This term is a reflection of the lease within the road reserve and possible effect to the Phillimore Street Precinct Master Plan. City Officers are also of the opinion that the proposed lease term is fair in consideration of the financial outlay by the applicant. The lease applicant has requested a term of twenty one (21) years in line with the maximum term the City is able to approve under the terms of the Management Order. In November 2006 Council adopted the Phillimore Street Precinct Master Plan. This plan related to land owned by the Department of Transport, the Fremantle Ports and the City of Fremantle which was endorsed by all stakeholders with the guidance of the community’s comments.

The Phillimore Street Master Plan ensured development solutions, including upgrading of the pedestrian walkways and improved traffic circulation, that are compatible with the precinct’s heritage values. The Phillimore Street Integrated Precinct covers the whole length of Phillimore Street, part of Arthur Head, Fleet St, Fremantle Ports Building forecourt (extension of Cliff St into Victoria Quay), Peter Hughes Drive, Railway Station's precinct, including forecourt and bus interchange, Pioneer Park, west end of Beach Road and northern part of Market Street. The precinct is of particular importance within the Fremantle City Centre and the waterfront for the following reasons:

a) It forms an interface and overlap between the port and the city and has traditionally functioned as the main access to Victoria Quay and operational area of the port - historically it carried and distributed all traffic associated with the arrival (of people and trade) in Fremantle by the major transportation means (ship, ferry, train, tram, or bus).


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b) The precinct's uses were, and to some extent still are, port related i.e. shipping companies, custom house(s), warehouses, bond stores, woolstores, hotels (immigration) and weighbridge station. While Increasingly Phillimore Street is becoming focus of all traffic related to the new adaptive uses of the West End, the west end of Victoria Quay role will slowly take on the role of the extended city centre. Particularly when considering a further shift of the operational part of the port to the east and North Quays and the establishment of new, adoptive, non-port related uses, such as the commercial, educational, cultural, tourism, recreation, fishing, walking and cycling

c) The heritage significance of the precinct, evidenced in the intact original layout of the streets and wharves, the surviving heritage buildings, majority of which are heritage listed, and both, an attractive Victorian streetscape and the industrial heritage of Victoria Quay, including the significant landmarks and visual connection between the city and the waterfront.

Parts a) and b) define not only the continuing essential role of both, Phillimore Street and Victoria Quay, as two major routes for all modes of transport, but they also raise the need for better integration and improved linkages between the city centre and the waterfront and determine an unusually large number of the statutory stakeholders with interest/statutory responsibility for maintenance/development of all land within the integrated precinct.

As the Master Plan required the financial contribution of other entities as well as the City the project as not moved forward at this point however with the recent adoption of revised Victoria Quay Master Plan actions relating to the Phillimore Street Integrated Precinct may proceed and although the activation of the Weybridge will fit in with this plan the lease over a section of road reserve could limit design. The following are the essential terms and conditions of a Lease for 2 Phillimore Street based on the Officers recommendation. Land Description. Portion of Lot 1846 on Plan: 164288 Volume LR3121 Folio 105 Property Description Weybridge Station 2 Phillimore Street, Fremantle Registered Proprietor City of Fremantle Co/- Minister for Lands Site Area. Approx 261m2


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Lease Commencement Date TBA Lease Term Five (5) years Further Term Five (5) years Second Further Term Five (5) years Annual Rent $10,000.00pa + GST To be payable in equal monthly amounts Rent Review Annually on the anniversary of the Lease based on Consumer Price Index (CPI) and by independent market valuation at the commencement of a further term. Permitted Use Small bar/café Outgoings To be charged on demand, including (if applicable) but not limited too;

Council Rates Emergency Service Levy Land Tax Building Insurance Water Rates/Usage Electricity (if applicable)

Legal Fees for New Lease Each party will be responsible for their own costs.


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Special Conditions

1. Liquor license will be for a maximum of 75 persons Liquor to be served as an accompaniment to food The Lessee must not sell any alcohol mixed or accompanied with any

energy drink. promote or market the sale or supply of beverages in such a way that

would encourage rapid consumption of liquor (eg. drinks known as ‘laybacks’, ‘shooters’, ‘test tubes’, ‘jelly shots’, ‘blasters’, bombs’ or any other similar emotive title).

2. The applicant acknowledges that the property is heritage listed and will act to preserve its heritage nature under the direction of the appropriate representatives with Heritage conservation background approved by the City's Heritage Coordinator.

3. A list of all proposed works to the building and additions will be required as an

annexure to the Lease document.

4. Rent will not be payable until the liquor licence is secured, however if the liquor licence is not secured by a date yet to be specified then rent will commence and property will be activated by the Lessee under the permitted use of a café.

5. Should the liquor licence not be approved the Lessee will continue to operate the

building under the permitted use of a café. An additional Lease will be required for the road reserve outside of the current boundary area.


Financial

The rent per annum will be $10,000 + GST. This amount was proposed by the applicant and is above an independent market valuation commissioned by the City. Legal

The Lease will be subject to Minister for Lands approval and be required to comply with the WA Local Government Act 1995 and Commercial Tenancy Act 1985. Operational

Nil Organisational

City Officers will finalise Lease negotiation based on the essential terms and conditions outlined within this item.


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CONCLUSION

The development of the Weighbridge Station will offer an addition to the City’s plan to open “corridors” within Fremantle and compliment the proposed activation by Sunset Events at J Shed and the Arthur Head precinct. The applicant is aware of the City’s power to lease the premises for a maximum term of twenty one (21) years under the Management Order and has requested the full length of the lease possible. To allow for the permitted use of “small bar” the applicant will require toilet facilities onsite and as the area surrounding the Weighbridge Station will be used as alfresco an area within the Road Reserve has been requested on a second lease to allow for the toilets to be developed separately to the main building. These planned works will be required to proceed through a development application process however the area in which these toilets would be located may directly affect the City’s future plans within the Phillimore Street Integrated Precinct Master Plan. Further to this it should also be considered that although the City has the right to lease to an applicant for a term up to twenty one (21) years subject to Minister for Lands approval it does not warrant an applicant being automatically entitled to the maximum term.


The Phillimore Street precinct integrated Master Plan


Should the lease be approved by Council the applicant will be required to follow community engagement process in line with their liquor licence application.




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For Council to;

1. Approve a Lease term as follows;

a) First term: five (5) years b) Second term: five (5) years c) Third term: five (5) years

2. Approved Delegated Authority to the Chief Executive Officer based on the

following essential terms and conditions;

Land Description. Portion of Lot 1846 on Plan: 164288 Volume LR3121 Folio 105 Property Description Weybridge Station 2 Phillimore Street, Fremantle Registered Proprietor City of Fremantle Co/- Minister for Lands Site Area. Approx 261m2 Lease Commencement Date TBA Lease Term Five (5) years Further Term Five (5) years Second Further Term Five (5) years Annual Rent $10,000.00pa + GST


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To be payable in equal monthly amounts Rent Review Annually on the anniversary of the Lease based on Consumer Price Index (CPI) and by independent market valuation at the commencement of a further term. Permitted Use Small bar/café Outgoings To be charged on demand, including (if applicable) but not limited too;

Council Rates Emergency Service Levy Land Tax Building Insurance Water Rates/Usage Electricity (if applicable)


1. Liquor license will be for a maximum of 75 persons Liquor to be served as an accompaniment to food The Lessee must not sell any alcohol mixed or accompanied with

any energy drink. promote or market the sale or supply of beverages in such a way

that would encourage rapid consumption of liquor (eg. drinks known as ‘laybacks’, ‘shooters’, ‘test tubes’, ‘jelly shots’, ‘blasters’, bombs’ or any other similar emotive title).

2. The applicant acknowledges that the property is heritage listed and will act

to preserve its heritage nature under the direction of the appropriate representatives with Heritage conservation background approved by the City's Heritage Coordinator.

3. A list of all proposed works to the building and additions will be required as

an annexure to the Lease document.

4. Rent will not be payable until the liquor licence is secured, however if the liquor licence is not secured by a date yet to be specified then rent will commence and property will be activated by the Lessee under the permitted use of a café.


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5. Should the liquor licence not be approved the Lessee will continue to

operate the building under the permitted use of a café.


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SGS1501-8 MONTHLY FINANCIAL REPORT - DECEMBER 2014 ECM Reference: 087/002 Disclosure of Interest: Nil Meeting Date: 21 January 2015 Previous Item: SGS1412-5 of 17 December 2014 Responsible Officer: Glen Dougall, Director City Business Actioning Officer: Alan Carmichael, Manager Finance and Administration Decision Making Authority: Council Agenda Attachments: Statement of Financial Activity by Nature to 31

December 2014 Statement of Financial Position as at 31 December 2014 Determination of Closing Funds (Net Current Assets) as at 31 December 2014 Schedule of Accounts Paid December 2014 Investment Report to 31 December 2014 Debtors Outstanding as at 31 December 2014 Payment Report (EFT & Cheque) for December 2014 (viewed electronically) Payment Report (Purchasing Cards) for November 2014 (viewed electronically)

EXECUTIVE SUMMARY

The City adopted its annual budget for 2014/2015 on 2 July 2014 with an estimated municipal surplus brought forward from 30 June 2014 of $1 969 947 and estimated municipal surplus at 30 June 2015 of $100 000. This report highlights any issues that may impact on the financial position to 30 June 2015 and the opening funds for the 2014/2015 Budget.

BACKGROUND

The 2014/15 budget was adopted on 2 July 2014 with an estimated municipal surplus brought forward from 30 June 2014 of $1 969 947 and estimated municipal surplus at 30 June 2015 of $100 000. At its meeting on 23 July 2013 (Item SGS1407-11 refers), Council adopted nature and type as the preferred reporting format with 2.5% and a threshold of $300 000 as the level for explanation of variances. Since adoption of the budget, decisions of Council have amended the adopted $100 000 closing municipal surplus to a deficit of $19,239. The variation is comprised of the following items from the 26 November 2014 council meeting:-

SGS1411-6 Buster Fun Bus replacement. $5,487 SGS1411-7 Harvey Beach River Wall $93,000 (savings to be found at budget

review) C1411-5 Re Adoption of 2014-2015 Budget. Rates reduction $20,752.


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COMMENT

In finalising the 2014/15 budget, it was estimated that we would have a closing municipal surplus at 30 June 2014 of $1 969 947 which in turn became the opening municipal surplus in the 2014/15 budget. The external auditor has now issued an unqualified audit certificate for the financial statements to 30 June 2014 with a surplus of $1 856 988. A review of the annual budget is required to be undertaken no earlier than 31 December in the financial year and it is planned to submit that review to Council in February 2015. The $112,959 deficit between the estimated and actual closing position at 30 June 2014 as reported in the previous paragraph will be addressed as part of the budget review. Organisational Comment The State Administrative Tribunal (SAT) made orders to quash the differential rates imposed by the City on undeveloped properties in the 2012-13, 2013-14 and 2014-15 financial years. At its meeting of 26 November 2014 Council reimposed new differential rates and readopted budgets for the three years. The total estimated cost impact of the SAT decision over the three years is $86 247. Below is a graph for actual operating revenue by month versus their year to date budget. Rates have not been included as $38,000,000 is brought to account in one month and distorts the picture as does profit on sale of assets which is non cash and has also been excluded.

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$3,500,000

$4,000,000

$4,500,000

JulAug Sep

OctNov

DecJan

FebMar

AprMay

Jun

Operating Revenue

Operating Revenue Budget versus Actual(excluding rates and profit on sale of assets)

Revised Budget Actual


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Below is a graph for actual operating expenditure by month versus their year to date budget. The non cash entries of depreciation and loss on sale of assets have been excluded from the graph as they can distort the picture.

Rates As already mentioned, the decision of SAT will result in adjustments being made to some properties with refunds being made to a limited number of those properties. Fees and Charges.

Parking revenue is $546 000 under YTD budget of $6 143 000 and parking infringement revenue is $120 000 under its YTD budget of $1,181,000. The total includes the impact of the free parking promotion for December plus from 1 November 2014, the loss of the Fremantle Ports parking contract for car park number 42 is also affecting the year to date result. The full year impact of car park 42 is estimated at a net deficit of $380 000.

Leisure Centre revenue from the gym is down $152,000 on its year to date budget of $405,000 and has not recovered from the position it was operating at prior to the closing of the pools for major upgrade works.

Visitor Centre revenues are down $48,000 on their year to date budget of $115,000.

Commercial waste revenue is $98 000 under year to date budget as a result of later than anticipated issue of December 2014 invoices.

‐

1,000,000.00

2,000,000.00

3,000,000.00

4,000,000.00

5,000,000.00

6,000,000.00

7,000,000.00

Jul Aug Sep Oct Nov Dec JanFeb

MarApr

MayJun

Operating Expenditure

Operating Expenditure Budget versus Actual(excluding depreciation and loss on sale of assets)

Revised Budget Actual


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Employee Costs

Employee costs are $700,000 under year to date budget with the major reason being unfilled positions as follows:- There are unfilled positions in some business. However with agency which is

expensed under Materials and Contracts, if we exclude City Works agency labour it is $250,000 over year to date budget which means that level of saving is required from the employee budget.

City Works is $300,000 under year to date budget and most of that would relate to unfilled wages positions however they do not necessarily translate to budget savings as the work is likely to be undertaken by contractors and expensed under Materials and Contracts.

Materials and Contracts

On a year to date budget of $10 900 000, we are under budget by $503 000 which primarily relates to budget phasing. The business units with the largest under expenditures are Parking and Community Safety ($223 000), Information Technology ($174 000) and Asset Management ($101,000).

Capital Program Excluding the $7 800 000 for the acquisition of 2 Jones Street O'Connor and with 50% of the financial year elapsed capital expenditure YTD of $4 612 000 represents 73% against the year to date budget and 26% against the annual revised budget. The phasing of the capital budgets will be reviewed as a part of budget review. Below is a graph of the capital expenditure, excluding acquisition of the new depot site, against current revised monthly budget:-

$‐

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

Current Revised Budget ‐ Capital Expenditure Capital Expenditure ‐ Actual

Capital Expenditure Budget versus Actual(less acquisition of 2 Jones Street)


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The capital works quarterly information to 30 September 2014 that was tabled at the 22 October 2014 Ordinary Council Meeting (Item C1410-4) indicates far more advanced progress on the works program than the attached financial reports. Proceeds from disposal of assets The net proceeds from the sale of Pakenham Street was $333 600 less than budgeted due to reduction in sale price of $90 000 as per Council resolution C1410-1 of 8 October 2014 and GST payable of $243 600. From a budget perspective, as the proceeds are transferred to the Investment Reserve, there will be a contra saving on that item. Transfers to reserves As noted in proceeds from disposal of assets, a reduction in budgeted proceeds from the sale of Pakenham Street has reduced the transfer to the Investment Reserve. Profit or loss on disposal of assets The budgeted profit on sale of Pakenham Street was $400 000 but an actual loss of $133 000 resulted due to reduced sale proceeds as noted above under proceeds from disposal of assets and a $200 000 increase in the fair valuation of the property at 30 June 2014 which was not received until after the budget was adopted. Note: The profit or loss on sale of assets figures are non cash. With cash investments, action continues to implement the revised policy SG41 to limit investments in financial institutions which provide direct or indirect support of fossil fuel companies. During the month, funds on deposit reduced by $4.7 million but the percentage of investments with financial institutions registered as not supporting unlocking of carbon activities (http://www.marketforces.org.au/banks/map) increased from 37% to 46%. The major reason for the change was a reduction in funds during the month occurred with institutions that support the unlocking of carbon. Below is a graph showing the cash investment situation at 31 December 2014 and the carbon support/non-support position by financial institution.

AMP, $7,517,941 , 17%

ANZ, $11,161,499 , 25%

BOQ, $5,000,000 ,

11%

ING, $4,075,792 , 9%

ME Bank, $2,000,000 , 4%

NAB, $9,091,930 , 20%

Rural Bank, $6,500,000 ,

14%

Institutions that don't Support Unlocking of Carbon,

$21,017,941 , 46%

Cash Investments at 31 December 2014


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Due to the earlier agenda cut off time for the December meeting cycle, officers were not able to finalise the detail for November 2014 purchase card transactions. As a consequence, the November 2014 Purchase Card expenditure report is provided as an attachment to this agenda.


Financial

This report is provided to enable Council to keep track of how the allocation of costs and receipt of revenues is tracking against the budget. It is also provided to identify any issues against budget which Council should be informed of. Legal

Local Government (Financial Management) Regulation 34 requires a monthly financial activity statement along with explanation of any material variances to be prepared and presented to an ordinary meeting of council. Under section 6.10 of the Local Government Act 1995 and Local Government (Financial Management) Regulation 12(1); (a) council has delegated authority to the CEO under item 3.2, Accounts for Payment - Authorisation Of, to make payments from the municipal fund and trust fund. The lists of accounts paid are presented in accordance with Local Government (Financial Management) Regulations 13(1) and (3). Operational

This report is provided to Council to keep track of the operational issues affecting the implementation of projects and activities provided for under the 2014/15 adopted budget by reporting actual revenue and expenditure against budget. Organisational

No direct impact but results year to date may highlight matters that have arisen or may need to be addressed in the future.

CONCLUSION

The financial statements as attached for further review of payments made during December 2014 and cash deposits at the end of December 2014. Also attached is the year to date statement of financial activity and statement of financial position for information. The financial statements for the 12 months to 30 June 2014 have now been finalised with the issue of an unqualified audit certificate.


Nil


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Nil




1. The City of Fremantle Financial Report including the Statement of Financial Activity, Statement of Financial Position and Statement of Closing position for the period ended 31 December 2014 is received,

2. Council receives the payments authorised under delegated authority and

detailed in the list of invoices for December 2014, presented as per the summaries set out in the attached schedules and include creditors that have been paid in accordance with the Local Government (Financial Management) Regulations 1996.


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CONFIDENTIAL MATTERS

SGS1501-9 APPLICATION FOR LEASE - FLOWHOUSE - PORTION OF PORT BEACH RESERVE

ECM Reference: 049/008 Disclosure of Interest: Nil Meeting Date: 21 January 2015 Previous Item: Nil Responsible Officer: Glen Dougall, Director City Business Actioning Officer: Nadine Hume, Property Services Administrator Decision Making Authority: Council Agenda Attachments: Application – Flow House Proposal

Proposed Plan of Area Flow House investment costs Proposed car park plan Location of proposed car park

REASON FOR CONFIDENTIALITY

This report is CONFIDENTIAL in accordance with Section 5.23(2) of the Local Government Act 1995 which permits the meeting to be closed to the public for business relating to the following: (e) a matter that if disclosed, would reveal -

(i) a trade secret; (ii) information that has a commercial value to a person; or (iii) information about the business, professional, commercial or financial affairs of

a person


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SUMMARY GUIDE TO CITIZEN PARTICIPATION AND CONSULTATION

The Council adopted a Community Engagement Policy in December 2010 to give effect to its commitment to involving citizens in its decision-making processes. The City values community engagement and recognises the benefits that can flow to the quality of decision-making and the level of community satisfaction. Effective community engagement requires total clarity so that Elected Members, Council officers and citizens fully understand their respective rights and responsibilities as well as the limits of their involvement in relation to any decision to be made by the City.

How consultative processes work at the City of Fremantle

The City’s decision makers 1.

The Council, comprised of Elected Members, makes policy, budgetary and key strategic decisions while the CEO, sometimes via on-delegation to other City officers, makes operational decisions.

Various participation opportunities 2.

The City provides opportunities for participation in the decision-making process by citizens via itscouncil appointed working groups, its community precinct system, and targeted community engagement processes in relation to specific issues or decisions.

Objective processes also used 3.

The City also seeks to understand the needs and views of the community via scientific and objective processes such as its bi-ennial community survey.

All decisions are made by Council or the CEO 4.

These opportunities afforded to citizens to participate in the decision-making process do not include the capacity to make the decision. Decisions are ultimately always made by Council or the CEO (or his/her delegated nominee).

Precinct focus is primarily local, but also city-wide

5.

The community precinct system establishes units of geographic community of interest, but provides for input in relation to individual geographic areas as well as on city-wide issues.

All input is of equal value 6.

No source of advice or input is more valuable or given more weight by the decision-makers than any other. The relevance and rationality of the advice counts in influencing the views of decision-makers.

Decisions will not necessarily reflect the majority view received

7.

Local Government in WA is a representative democracy. Elected Members and the CEO are charged under the Local Government Act with the responsibility to make decisions based on fact and the merits of the issue without fear or favour and are accountable for their actions and decisions under law. Elected Members are accountable to the people via periodic elections. As it is a representative democracy, decisions may not be made in favour of the majority view expressed via consultative processes. Decisions must also be made in accordance with any statute that applies or within the parameters


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of budgetary considerations. All consultations will clearly outline from the outset any constraints or limitations associated with the issue.

Decisions made for the overall good of Fremantle

8.

The Local Government Act requires decision-makers to make decisions in the interests of “the good government of the district”. This means that decision-makers must exercise their judgment about the best interests of Fremantle as a whole as well as about the interests of the immediately affected neighbourhood. This responsibility from time to time puts decision-makers at odds with the expressed views of citizens from the local neighbourhood who may understandably take a narrower view of considerations at hand.

Diversity of view on most issues 9.

The City is wary of claiming to speak for the ‘community’ and wary of those who claim to do so. The City recognises how difficult it is to understand what such a diverse community with such a variety of stakeholders thinks about an issue. The City recognises that, on most significant issues, diverse views exist that need to be respected and taken into account by the decision-makers.

City officers must be impartial 10.

City officers are charged with the responsibility of being objective, non-political and unbiased. It is the responsibility of the management of the City to ensure that this is the case. It is also recognised that City officers can find themselves unfairly accused of bias or incompetence by protagonists on certain issues and in these cases it is the responsibility of the City’s management to defend those City officers.

City officers must follow policy and procedures

11.

The City’s community engagement policy identifies nine principles that apply to all community engagement processes, including a commitment to be clear, transparent, responsive , inclusive, accountable andtimely. City officers are responsible for ensuring that the policy and any other relevant procedure is fully complied with so that citizens are not deprived of their rights to be heard.


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Community engagement processes have cut-off dates that will be adhered to.

12.

As City officers have the responsibility to provide objective, professional advice to decision-makers, they are entitled to an appropriate period of time and resource base to undertake the analysis required and to prepare reports. As a consequence, community engagement processes need to have defined and rigorously observed cut-off dates, after which date officers will not include ‘late’ input in their analysis. In such circumstances, the existence of ‘late’ input will be made known to decision-makers. In most cases where community input is involved, the Council is the decision-maker and this affords community members the opportunity to make input after the cut-off date via personal representations to individual Elected Members and via presentations to Committee and Council Meetings.

Citizens need to check for any changes to decision making arrangements made

13.

The City will take initial responsibility for making citizens aware of expected time-frames and decision making processes, including dates of Standing Committee and Council Meetings if relevant. However, as these details can change, it is the citizens responsibility to check for any changes by visiting the City’s website, checking the Fremantle News in the Fremantle Gazette or inquiring at the Customer Service Centre by phone, email or in-person.

Citizens are entitled to know how their input has been assessed

14.

In reporting to decision-makers, City officers will in all cases produce a community engagement outcomes report that summarises comment and recommends whether it should be taken on board, with reasons.

Reasons for decisions must be transparent 15.

Decision-makers must provide the reasons for their decisions.

Decisions posted on the City’s website 16.

Decisions of the City need to be transparent and easily accessed. For reasons of cost, citizens making input on an issue will not be individually notified of the outcome, but can access the decision at the City’s website under ‘community engagement’ or at the City Library or Service and Information Centre.


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Issues that Council May Treat as Confidential Section 5.23 of the new Local Government Act 1995, Meetings generally open to the public, states: 1. Subject to subsection (2), the following are to be open to members of the public -

a) all council meetings; and b) all meetings of any committee to which a local government power or duty has

been delegated.

2. If a meeting is being held by a council or by a committee referred to in subsection (1) (b), the council or committee may close to members of the public the meeting, or part of the meeting, if the meeting or the part of the meeting deals with any of the following:

a) a matter affecting an employee or employees; b) the personal affairs of any person; c) a contract entered into, or which may be entered into, by the local government

and which relates to a matter to be discussed at the meeting; d) legal advice obtained, or which may be obtained, by the local government and

which relates to a matter to be discussed at the meeting; e) a matter that if disclosed, would reveal –

i) a trade secret; ii) information that has a commercial value to a person; or iii) information about the business, professional, commercial or financial

affairs of a person. Where the trade secret or information is held by, or is about, a person other than the local government.

f) a matter that if disclosed, could be reasonably expected to - i) impair the effectiveness of any lawful method or procedure for preventing,

detecting, investigating or dealing with any contravention or possible contravention of the law;

ii) endanger the security of the local government’s property; or iii) prejudice the maintenance or enforcement of a lawful measure for

protecting public safety.

g) information which is the subject of a direction given under section 23 (Ia) of the Parliamentary Commissioner Act 1971; and

h) such other matters as may be prescribed.

3. A decision to close a meeting or part of a meeting and the reason for the decision are to be recorded in the minutes of the meeting.

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